Luxury Institute News

June 28, 2012

Wealthy Shoppers Don’t Buy into ‘Lux-Anthropy’

Posted in Luxury Market,Social Responsibility,WealthSurvey,Wealthy Consumer
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By Robert Frank
CNBC
June 27, 2012

The luxury world  is filled with talk about “social good.”

The wealthy are going Green, we’re told. They care about how companies treat their workers and communities. They prefer to practice responsible Lux-Anthropy, which maintains you can buy that expensive handbag or necklace and still feel good about its positive impact on mankind.

But apparently, there limits to Lux-Anthropy.

A new survey from the Luxury Institute shows that just 39 percent of consumers with more than $150,000 in income are willing to pay a premium for brands that champion high ethical standards.  And the number of affluent consumers who seek out ethical brands is down by 11 percent since 2007.

“Even wealthy consumers have de-emphasized social responsibility as this economy focuses everyone on price value and away from social issues,” says Luxury Institute CEO Milton Pedraza.

Click the link to read the entire article which includes a quote from Milton Pedraza, CEO of Luxury Institute: http://www.cnbc.com/id/47979078

June 26, 2012

Social Responsibility Is Nice But Not Worth Paying for in Today’s Economy, According to Wealthy Consumers Surveyed by Luxury Institute

Posted in Customer Experience,Luxury Brands,Press Releases,Social Media,Social Responsibility,Wealthy Consumer
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(NEW YORK) June 26, 2012 — In a new survey by the independent and objective New York-based Luxury Institute, “Corporate Social Responsibility: The Wealthy Consumer’s Viewpoint,” U.S. consumers earning at least $150,000 per year define socially responsible corporate behavior, rate companies and divulge importance of socially responsible practices in shaping purchase decisions. Responses were compared to those from the same survey in 2007.

Most (82%) wealthy Americans define social responsibility by a company behaving ethically with employees, customers and suppliers. Environmental behavior and philanthropic actions are both named by respondents as an essential component of CSR (58%).

Almost half (45%) of wealthy consumers say they seek out brands with high ethical standards, but only 39% of these shoppers would be willing to pay a premium. That’s down from 56% who would pay a premium in 2007. Apple, BMW, Coach, Lexus, Mercedes-Benz, Nordstrom, Starbucks and Whole Foods are frequently cited as highly ethical standouts.

Twenty-seven percent of wealthy consumers learn about companies’ socially responsible behavior via Facebook or Twitter. That’s up from 8% who received their information from social media in 2007. Reading news articles is the most popular (52%) way to learn of CSR efforts, down from 64% five years ago.

“Even wealthy consumers have de-emphasized social responsibility as this economy focuses everyone on price/value and away from social issues,” says Luxury Institute CEO Milton Pedraza. “Nevertheless, we see that luxury and premium brands that are socially responsible do better even during recessions because doing well by doing good is a universal and timeless concept.”

Respondents reported average income of $307,000 and average net worth of $3.1 million.

About Luxury Institute (www.LuxuryInstitute.com)
The Luxury Institute is the objective and independent global voice of the high net-worth consumer. The Institute conducts extensive and actionable research with wealthy consumers about their behaviors and attitudes on customer experience best practices. In addition, we work closely with top-tier luxury brands to successfully transform their organizational cultures into more profitable customer-centric enterprises. Our Luxury CRM Culture consulting process leverages our fact-based research and enables luxury brands to dramatically Outbehave as well as Outperform their competition. The Luxury Institute also operates LuxuryBoard.com, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

October 5, 2011

Time to check out Saks, Tiffany?

Posted in Finance,Luxury Market,Retail
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The economy is slowing, and most consumers are cutting back — but it looks like the well-heeled have barely noticed. That means the stocks of luxury retailers may be in for lift.

By Michael Brush
MSN Money
October 4, 2011

…And I hear a similar tale from the Luxury Institute, based in New York, which conducts regular surveys of wealthy consumers, those with annual incomes of $150,000 or more and median net worth of $1.2 million. Surveys done since the market meltdown started this summer found that despite such weakness, significantly fewer wealthy consumers say they will cut back on luxury-goods spending, compared with the previous two years. “They are feeling a little bit of the pain, but it is not dramatic,” says Milton Pedraza, Luxury Institute’s CEO…

Click the link to read the entire article: http://money.msn.com/investment-advice/time-to-check-out-saks-tiffany-brush.aspx

September 28, 2011

Luxury Spending Surge Continues in China Even as Wealthy Throttle Back on Purchases in Europe, Japan and U.S.; Half of Wealthy Chinese Plan to Spend More on Luxury This Year, Compared to Just 6% in the U.S., Japan and Germany

Posted in China,Europe,Luxury Market,Press Releases,WealthSurvey
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(NEW YORK) Sep 28, 2011- Wealthy shoppers from seven countries around the globe earning at least $150,000 (in local currency) reveal candid attitudes on luxury brands and personal spending plans in the “2011 State of the Luxury Industry: A Global Comparison of Consumers in Top Markets.” The just-completed survey conducted by the independent and objective New York City-based Luxury Institute shows strong increases in luxury spending continuing to come from China, while restraint is more widespread in the U.S., U.K., France, Germany, Italy and Japan.

More than half (57%) of wealthy Chinese shoppers say that the current economic environment has prompted them to spend more on luxury in the past year; 50% plan to boost spending in the next 12 months. This compares to just 10% of the wealthy in the U.S. who have stepped up spending recently and 6% who plan to spend more this year. In the U.S., consumers are twice as likely as they are in China (32% vs. 16%) to have trimmed luxury spending last year.

More than half of wealthy Chinese expect to boost spending on luxury travel, apparel, fitness, jewelry and shoes.

“China is clearly driving growth in global luxury brands,” says Luxury Institute CEO Milton Pedraza. “Exclusivity and prestige continue to be highly prized by wealthy Chinese consumers, even more than in the U.S. or Europe.”

For more details in the complete survey, visit LuxuryInstitute.com.

About Luxury Institute (www.LuxuryInstitute.com)
The Luxury Institute is the objective and independent global voice of the high net-worth consumer. The Institute conducts extensive and actionable research with wealthy consumers about their behaviors and attitudes on customer experience best practices. In addition, we work closely with top-tier luxury brands to successfully transform their organizational cultures into more profitable customer-centric enterprises. Our Luxury CRM Culture consulting process leverages our fact-based research and enables luxury brands to dramatically Outbehave as well as Outperform their competition. The Luxury Institute also operates LuxuryBoard.com, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

For Further Information, Please Contact:

The Luxury Institute, LLC
Martin Swanson
Vice President
(914) 909-6350
mswanson@luxuryinstitute.com

September 21, 2011

Most Wealthy U.S. Shoppers Plan to Keep on Spending on Luxury Travel and Technology Are the Biggest Beneficiaries, but Jewelry and Antiques Look Vulnerable to Cutbacks

Posted in Antiques,Jewelry,Luxury Market,Press Releases,Retail,Travel & Leisure,WealthSurvey
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(NEW YORK) September 21, 2011 – The new “State of the Luxury Industry According to U.S. Consumers 2009-2011” survey from the independent and objective New York City-based Luxury Institute reveals that two-thirds of U.S. households earning at least $150,000 per year do not plan to trim spending on luxury purchases in coming months, a three year-high for optimism.

Although 32% of wealthy consumers report spending less on luxury recently due to the economy, that’s down from 37% in August 2010 and 42% in August 2009 who reported cutting back. Furthermore, 10% report boosting luxury spending in recent months, up from 7% who said the same last year.  Many (39%) still report buying what they need instead of what they want, down from 55% who were similarly cautious two years ago.

Good news for hotels and Apple: the top two luxury categories on which the wealthy indicate plans to spend more are travel (18%) and technology (16%). Other notable turnarounds include automobiles, where 11% of the wealthy plan to spend more, up from 8% in 2010.

Jewelry (39%), antiques (37%), custom apparel (34%), art (34%), handbags (33%) and watches (33%) top the list of likely areas for the wealthy to cut.

“Despite all of the turmoil in the economy and markets, wealthy shoppers show remarkable resilience,” says Luxury Institute CEO Milton Pedraza. “Rewards accrue to retailers who focus on providing exclusive objects and experiences with impeccable service.”

For more details and full survey results, visit LuxuryInstitute.com.

About Luxury Institute (www.LuxuryInstitute.com)

The Luxury Institute is the objective and independent global voice of the high net-worth consumer. The Institute conducts extensive and actionable research with wealthy consumers about their behaviors and attitudes on customer experience best practices. In addition, we work closely with top-tier luxury brands to successfully transform their organizational cultures into more profitable customer-centric enterprises. Our Luxury CRM Culture consulting process leverages our fact-based research and enables luxury brands to dramatically Outbehave as well as Outperform their competition. The Luxury Institute also operates LuxuryBoard.com, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

For Further Information, Please Contact:

The Luxury Institute, LLC
Martin Swanson
Vice President
(914) 909-6350
mswanson@luxuryinstitute.com

© 2011 Copyright Luxury Institute LLC. All rights reserved

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